It’s decision day in Bombardier’s fight with Boeing over tariffs in the U.S.

01/26/2018

Bombardier Inc. will find out this afternoon whether nearly 300 per cent duties will be applied to American imports of its C Series aircraft from Canada.

The U.S. International Trade Commission will decide whether it believes Boeing stands to sustain harm by the planes, even though aircraft destined for American customers are slated to come from a new assembly line near the Airbus facility in Mobile, Ala.

Montreal-based Bombardier needs to win support from three of four commissioners since Boeing wins on a tie vote.

Boeing launched the trade case last April, arguing that governments in Canada and Britain subsidized the plane’s development and allowed Bombardier to sell it at unfairly low prices.

The Department of Commerce imposed anti-dumping and countervailing duties totalling 292.21 per cent. Those duties would be imposed if the commission sides with Boeing, but be eliminated if Bombardier wins.

The lone U.S. customer, Delta Air Lines Inc., was originally expected to receive the first of its firm order for 75 CS100 planes in the spring, but now plans to wait until the aircraft are assembled in the United States.

Many industry observers expect the commissioners will side with Boeing because of increased protectionist tendencies since Donald Trump became the U.S. president.

Canada is expected to appeal an unfavourable ruling to the World Trade Organization and through the North American Free Trade Agreement under Chapter 19.

In a final submission to the USITC, Bombardier said it expects Boeing will likely respond to a loss by filing a new petition once there is a new U.S. order for the C Series because it doesn’t believe the Alabama line will be built.

Bombardier said the threat of a new petition makes the proposed partnership with Airbus SE to build a U.S. full assembly line a must, regardless of how the case is resolved.

Boeing told the commission that the U.S. aircraft industry’s fate in its hands.